Understanding the Taxes Imposed on Your Telecom Bills

Written by Karen Thatcher

Continued from page 1

These taxes may be imposed by a municipality, county, school district, transportation district, state or other taxing body. The "state and local taxes" section of your bill may be a combination of such items. Sales, use and special taxes generally apply to local service charges, additional calls or message unit charges, installation charges, and intrastate toll charges. (Most states also tax interstate toll charges.) And again, these taxes are most often a percent ofrepparttar items to which they apply. That base may include franchise taxes, surcharges or other service fees. In other words, you are taxed on taxes!

Federal Excise Tax

This tax is imposed by Congress on non-exempt items. It generally applies to regulated services, except private lines, mileage, centrex-related enhancements, service and installation charges, and some other services. The base on whichrepparttar 133542 tax is calculated may include franchise taxes, surcharges, and gross receipts taxes. Originally a Spanish-American War "luxury" tax,repparttar 133543 rate has varied between 1% and 10% overrepparttar 133544 years, but has been held constant at 3% since 1983.

Remember, taxes are not uniformly imposed on all services. For example, white-page directory advertising is not taxed in most states, unless this statement item includes other items. (Arkansas and Oklahoma are exceptions, however.)

Who is Exempt?

Charities, churches, schoools, nonprofit educational and hospital operations, certain other entities that receive government funding, foreign counselor operations, and others, may be exempt from state and/or federal taxes. For example, common carriers, newspapers and broadcast companies may be exempt from federal tax on some services.

To understandrepparttar 133545 specific services that are exempt from federal tax, refer torepparttar 133546 Internal Revenue Service publication 510 entitled Communications Tax. This publication is very specific as to what taxes are federally imposed and which are exempt. Contact me directly if you'd like your own copy.

As you can see, taxes can be a complicated subject as it applies to your telecom bills. But understanding them can be a major step in reducing your costs when doing a cost-reduction study.

Karen Thatcher is President of TelCon Associates, a 30 year old telecom consulting and management firm. TelCon Associates helps companies gain control and reduce telecom/IT spending through a guaranteed cost-reduction consulting process. CLICK HERE to learn more.

What is a Customer Service Record or "CSR"?

Written by Robert Potter

Continued from page 1

A typical CSR is divided into four sections: The Header Record Section,repparttar List Section,repparttar 133541 Bill Section, andrepparttar 133542 S&E Section. Below you'll find a summary of what each section contains.

The Header Record Section

This Header Record section is found atrepparttar 133543 top ofrepparttar 133544 CSR, and details information aboutrepparttar 133545 CSR andrepparttar 133546 account itself. While CSR's do not always contain identical information, generallyrepparttar 133547 header section will include:repparttar 133548 print date, billing period, directory, class of service (business or residential), customer identification code, account number, USOC code and quantity of service items, description of service, unit rate, total monthly charge, and tax. The following two sections ofrepparttar 133549 CSR contain important information about your company.

The List Section

The List section identifies whether or notrepparttar 133550 account is listed inrepparttar 133551 white pages ofrepparttar 133552 telephone directory, as well as howrepparttar 133553 listing reads. Ironically, there is an extra charge for non-published listings, unless there is already another account listed atrepparttar 133554 same service address. The code NLST indicates that it is NOT listed inrepparttar 133555 the telephone directory although it still may be listed with directory assistance operators. SIC definesrepparttar 133556 service industry for proper Yellow Pages headings.

The Bill Section

The bill section ofrepparttar 133557 CSR includes: bill name (BN1), bill address (BA) and tax area (TAR) forrepparttar 133558 account. The billing address is oftentimes different fromrepparttar 133559 bill name.

The Service and Equipment Section

This section isrepparttar 133560 most important part ofrepparttar 133561 CSR. Since this area lists all charges associated with each phone line,repparttar 133562 bill section is alsorepparttar 133563 area where USOC and nomenclature translations are necessary, in order to identifyrepparttar 133564 exact line items. It is this area ofrepparttar 133565 CSR where you will spendrepparttar 133566 bulk of your auditing time. Obtaining and reviewing CSR's is an important part ofrepparttar 133567 telecom auditing process. A thorough job can be a time consuming and tedious, butrepparttar 133568 cost savings and increased efficiency is well worthrepparttar 133569 time and effort.

Robert Potter is Vice-President and senior consultant of TelCon Associates, a 30 year old telecom consulting and management firm. TelCon Associates helps companies gain control and reduce telecom/IT spending through a guaranteed cost-reduction consulting process.

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